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2017 (5) TMI 526 - AT - Income TaxUndisclosed receipt from beauty parlors - Held that:- The search statement cannot override the evidence seized by the department in the shape of documents. The gross receipts cannot be taxed as income. Therefore, under the facts and circumstances of the case, CIT-A correctly directed the AO to give credit of the expenses recorded in the seized documents but not found recorded in the regular books of account . The A/R of the assessee has made working for this. The comparative chart is placed at PB pg 100 to 102 which shows the total expenses of ₹ 14,63,159/- are recorded in the seized documents but not in regular books of the parlour. This expenses were incurred to earn the suppressed receipts of the parlour therefore, it should be deducted from the suppressed receipts of the parlour. Therefore, CIT-A correctly directed the AO to delete the addition of ₹ 14,63,159/- and rest of the addition of ₹ 25,38,273 – ₹ 14,63,159 = ₹ 10,75,114/- is sustained. Addition on account of goodwill receipt - it was contended that assessee herself generated the name for herself by setting up and creation of chain on this account which is capital in nature only and not liable to tax being not a revenue receipt - Held that:- It is noted from the available records that the assessee had repaid the amount of ₹ 21.50 lacs as against the receipt of amount of ₹ 21.00 lacs from Smt. Saroj Joshi which includes the impugned amount of ₹ 16.00 lacs. In the books of account the assessee treated ₹ 16.00 lacs as receipt on account of goodwill and ₹ 5.00 lacs on account of contribution in capital account of firm. - taking into consideration all the facts and circumstances of the case, we find no reason to interfere with the order of the ld. CIT(A) that the amount of ₹ 16.00 lacs is not taxable receipt in the hands of assessee, accordingly , therefore, direct the AO to delete the addition made by him on account of goodwill. - Decided in favour of assessee.
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